Morgan Stanley Rates Capital One (COF) Overweight After Discover Acquisition Announcement

Capital One Financial Corporation (NYSE:COF) ranks among the best non-tech stocks to buy according to billionaires. With an Overweight rating and a $261 price target, Morgan Stanley resumed coverage of Capital One Financial Corporation (NYSE:COF) on July 10. The acquisition of Discover by Capital One, according to the firm, is a “game-changer” that opens up substantial growth through network ownership and other synergies.

Morgan Stanley Rates Capital One (COF) Overweight After Discover Acquisition Announcement

According to Morgan Stanley, the financial services company can gain longer-term advantages by expanding its network, adding new products, and strengthening its deposit franchise.

The firm believes there is still room for growth even if Capital One’s stock has increased 21.66% year-to-date. The firm notes that the stock is “still not fully priced for coming synergies & ramp in capital return.”

Given the payments and network possibilities provided by the Discover acquisition, the firm believes Capital One Financial Corporation (NYSE:COF) is entitled to a greater multiple.

Capital One Financial Corporation (NYSE:COF) is an American bank holding corporation that specializes in credit cards, auto loans, banking, and savings accounts.

While we acknowledge the potential of COF to grow, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and have limited downside risk. If you are looking for an AI stock that is more promising than COF and that has 100x upside potential, check out our report about this cheapest AI stock.

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Disclosure: None.